Weyerhaeuser, Willamette Sign Accord

In a statement release late Monday night, Weyerhaeuser said it would pay $55.50 a share for Willamette and assume $1.7 billion in debt. The agreement is valid through Feb. 8.

In trading Monday on the New York Stock Exchange, shares of Willamette were up 4 cents to $55.20, and Weyerhaeuser was up $2.76 to $59.56.

The two companies agreed last week to merge. The deal was resisted for years by the Willamette board of directors, led by Chairman William Swindells Jr., grandson of a company co-founder.

Weyerhaeuser's chairman, Steven Rogel, was a former Willamette employee whom Swindells had groomed to take over as chief executive officer in 1995. But Rogel left in 1997 to become Weyerhaeuser's chairman.

Rogel immediately offered to buy his old company after taking control of Weyerhaeuser, but Swindells and the Willamette board kept rejecting his overtures.

On Nov. 29, 2000, Rogel announced a hostile takeover and started the bidding at $48 a share. Swindells and the board worked to convince Wall Street that Willamette was worth closer to $60 a share.

Last year, Rogel upped the ante to $50 a share, then moved to $55 as Willamette announced talks with Georgia-Pacific Corp. to buy the Atlanta-based company's building products division as a way to block the Weyerhaeuser takeover.

While Willamette and Georgia-Pacific talked, Willamette shareholders and investment fund managers began pushing for a deal with Weyerhaeuser.

Willamette also announced it had ended talks with Georgia-Pacific, a deal that troubled analysts.

"I have had the privilege of working with employees of both companies and I am confident that we will be able to successfully integrate and build a stronger, more efficient company," Rogel said.

Weyerhaeuser had an estimated $15.6 billion in 2001 sales and is already the largest private owner of softwood timber in the world, managing 38 million acres of forest in the United States and Canada.

Willamette, by comparison, owns just 1.7 million acres of timber land but has 105 mills in the United States, France, Ireland and Mexico. Estimated sales for 2001 are $4.6 billion.